Axios: 11 members of Congress argue Sony is unfairly hurting Xbox in Japan

[Swift_Star]

Th

HAHAHAHAHA. LMFAO. This shit is just too funny.

Like I said months ago, Sony was going to end up overplaying their hand. They should have just accepted the 10 year deal and moved on. Instead, they're going to be getting investigated within Japan, will be stuck showing 4+ years of documents come August that will definitely expose a lot of their shitty practices and best of all, they may not even get COD at all. LMFAO!!!

What a great day.

And to think, Xbox One will end up being a blessing in disguise for Microsoft and Xbox. Oh man. Give me more acquisitions baby!!

They are not getting investigated, moron, this is not going to be taken seriously.

 

[Swift_Star]

I'm afraid it escalated now. It's not just Sony who is threatened.

It never was just Sony. People are deluded if they thought it was the case.

 

[Dabaus]

Nintendo staying so quiet and partnering with Microsoft but not being “defined in the market” could come back to bite them if/when Microsoft uses this 98 percent argument to buy a Nintendo partner.

“No you can’t buy them that’s our partner!”

“Well it looks like you’re not apart of the market so you need to stay in your lane.”

Nintendo showing their true colors here by trusting Microsoft to screw Sony over.

 

[Entropi]

When you have no talent and lots of money you can leverage it to buy success.

 

[Swift_Star]

K

Nintendo staying so quiet and partnering with Microsoft but not being “defined in the market” could come back to bite them if/when Microsoft uses this 98 percent argument to buy a Nintendo partner.

“No you can’t buy them that’s our partner!”

“Well it looks like you’re not apart of the market so you need to stay in your lane.”

Nintendo showing their true colors here by trusting Microsoft to screw Sony over.

Nintendo probably simply don’t care tbh.

 

[Airbus]

RE4 sales so far are 86% on playstation platform and they try to accuse sony for being unfair

 

[Shmunter]

RE4 sales so far are 86% on playstation platform and they try to accuse sony for being unfair

Needs to be looked at, 86%

 

[Deleted member 223]

HAHAHAHAHA. LMFAO. This shit is just too funny.

Like I said months ago, Sony was going to end up overplaying their hand. They should have just accepted the 10 year deal and moved on. Instead, they're going to be getting investigated within Japan, will be stuck showing 4+ years of documents come August that will definitely expose a lot of their shitty practices and best of all, they may not even get COD at all. LMFAO!!!

What a great day.

And to think, Xbox One will end up being a blessing in disguise for Microsoft and Xbox. Oh man. Give me more acquisitions baby!!

This certainly was a release lol... you feel better bud?

Sony will not be investigated within Japan lmao. The Japanese won't do shit to their own. Just like in this instance, MS is showing that eventually the U.S will protect their own if push comes to shove. All standard fare. Biden won't do shit either, provided the deal goes through...... Fumio has been but the most loyal lapdog in trying times and this minor scuffe between MS and Sony is just kids being kids.

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All else being equal, Sony did what it was supposed to do and should have done as far as the ABK deal. They lose nothing, absolutely nothing asking for the deal to be killed. Having the deal pass is the worst option. Having the deal pass without any objections and settling for any crumbs if any from MS is the worst option of the worst option. No one is under any illusions here, only your normal sheeple class who are probably learning a lot by this ordeal about their own country and how the world works. That in the end the local giant gets protected, showing its big teeth was an expectation considered by anyone that's not an idiot and understands how big business politics work (not the make believe "free market", "regulator savior" BS kids are taught at school or the hopelessly propagandized human bots). Certainly Sony execs knew.

Given a do-over Sony should have acted more aggressively in the market, specially around the time of the Xbox One era and not allow MS to limp around. Instead of tip toeing around the meaning of exclusivity and falling for MS's greed trap (dual PC/console releases).... by doing so lessening brand perception with PC (MS Windows) releases; Sony should've doubled down on exclusivity and hard, specially with third party deals... and abuse their market power as much as they should...... around the time MS was running with the concerted marketing, narrative ruse of "exclusives are counter to what gaming is about" "when we all play we all win"..... which in doing so trying, in some ways successfully, to get Sony to lower its guard and its drive, to prevent it from going for the kill. But MS intent can only do so much however..... it takes a willing receptor for it to have any degree of success - inaction being a degree to success as well. It more or less worked by granting MS about 4-5 yrs reprieve.... enough room for the revanche while keeping a working base (current Xbox install base in U.S). That is imo, Sony's real strategic mistake... failing to deal the knock out blow - not knowing how to device the knock out blow. You don't let your rival hang around in the 4th quarter. We all know what MS in a similar market share position would have done - we all saw how EA prepared a literal carpet bombing against the PS4 around the Xbox One release - it just backfired cause MS messed up in other places and the whole plan shattered into a billion pieces. Hubris has a way of doing that.... from impending market domination with all momentum (X360), fake or otherwise, to overnight industry bum. A premium gaming industry with MS as its standard bearer is clearly a nightmare for consumers. It was so then and it still is.

Sony's miscalculations:

Lesson #1: Never appease your rival.
Lesson #2: Deal the knockout blow if opportunity presents itself.
Lesson #3: By seeking to avoid a war of attrition you end up with a war of attrition and encourage the war of attrition (perceived weakness). A war of attrition is inevitable. The real question is NOT how a war of attrition could be avoided but when does this war start and on what terms. Does it start when it's most advantageous to you or your rival? Who starts the war and under what terms?
-- For the sheep that don't understand - content exclusively/content hoarding is the war of attrition - its most important aspect anyway insofar as console gaming is concerned.

Lesson #4: Frugal marketing does not pay. Staying quiet is always a mistake. You either shape the narrative or others will shape the narrative for their own benefit. Not adapting to new marketing methods and aggressively staying on top of the narrative is counterproductive. Can't avoid "pay to play" (access to play, gift to play, ad-buy to play, exclusive scoop to play... etc etc.). There is a huge gaping hole in "grass root" influencers marketing (also known as guerrilla marketing) in Sony's marketing strategy. Not to be confused with celebrity endorsement marketing - one of the oldests forms. The competition is running freely here, largely unchallenged - mistake.

Big picture for Sony, they'll always be in this position so long as the biggest consumer market for gaming is on some foreign land and not Japan itself. You ultimately play by the rules of the house, for the time being the U.S, but in the future, if it were to be China, likewise. It's what it's.

As far as gamer to gamer releations is concerned....the communities are becoming more polarized and devided. Less consensus on old industry fundamentals - tried and true.

 

[Remij]

What a bunch of BS...

Sony, by stirring the hornets nest, may have inadvertently kicked off something which has lasting reprecussions on their business in the US and Japan.

I honestly don't like where this is heading... Sony is winning in Japan (over Xbox) because Japanese gamers simply don't like, or give a shit, about American game systems. They like the systems which get their Japanese games, which the Japanese developed systems get naturally..

It's literally taken decades to get to this point, and MS haven't been able to penetrate Japan.. they couldn't even back when they were getting more Japanese games... because Japanese gamers would just buy them on their Japanese devices instead. Sony has fostered those relationships like with Capcom and SquareEnix over decades.. Hell, Sony is largely the reason why Squaresoft became a household name in America and JRPGs became one of the biggest genres.. So naturally people associate those companies with Sony.. that's where most of these franchises were born. MS gets associated more with the western RPG studios that IT helped bring up..

That's just how it goes... and congress fucking around with this shit causing issues with gaming trade in Japan and US isn't going to benefit anyone at all.

 

[Dabaus]

Is it me or is Sonys silence deafening? A few months ago when Satya was being interviewed talking about China and Japan being a threat or whatever I said Sony should have accused him/Microsoft of being xenophobic and racist towards Asians.

They should’ve spoken up when that senator mouthed off too with the same response. Microsoft is somewhat able to control the narrative because they’re the only ones talking.

 

[KiryuRealty]

Nintendo staying so quiet and partnering with Microsoft but not being “defined in the market” could come back to bite them if/when Microsoft uses this 98 percent argument to buy a Nintendo partner.

“No you can’t buy them that’s our partner!”

“Well it looks like you’re not apart of the market so you need to stay in your lane.”

Nintendo showing their true colors here by trusting Microsoft to screw Sony over.

“Apart” and “a part” have opposite meanings.

 

[Dabaus]

Another thought I had, if this activision deal does go through I’d just say screw it, keep call of duty. To signal to other would be potential acquisition targets, especially in japan, “we pulled cod of all games off our platform, don’t think you can count on us to bail you out if you sell out.”

 

[Doncortez77]

Why am I not surprised…

 

[Swift_Star]

Another thought I had, if this activision deal does go through I’d just say screw it, keep call of duty. To signal to other would be potential acquisition targets, especially in japan, “we pulled cod of all games off our platform, don’t think you can count on us to bail you out if you sell out.”

I don’t particularly care about ABK. I care about MS buying everything else.

 

[Fenton]

 

[TubzGaming]

Published April 2, 2022 12:04 am ET :

How Microsoft Became Washington’s Favorite Tech Giant

President Brad Smith has taken an amicable role with regulators. Rivals say he also directs negative attention toward them. Microsoft’s Activision deal, under FTC review, will test the strategy.

www.wsj.com

When a congressional committee was preparing to publicly interrogate the CEOs of four tech giants in 2020, Microsoft Corp. President Brad Smith, whose employer wasn't on the hot seat, gave the lawmakers a private briefing. When Australia proposed a law to force Facebook and Google to pay for news articles, Mr. Smith endorsed it and offered Microsoft's Bing as an alternative. When the U.S. considered similar legislation, he went to Washington to testify in front of Congress to show his support.

Mr. Smith, a Microsoft veteran of almost 30 years and president for seven, has maneuvered his company to an enviable position in a regulatory environment that is increasingly hostile toward tech titans. Once an antitrust pariah itself, Microsoft is now widely seen by regulators as the friendly party among today's top tech companies, a status government officials and Microsoft insiders say flows largely from Mr. Smith's cultivation of friends in Washington.

Rivals say he is also skilled at directing negative attention toward competitors—to Microsoft's benefit.

The 63-year-old's influence is being tested as the company tries to smooth the way for its largest-ever acquisition, a $75 billion purchase of Activision Blizzard Inc. While regulators have yet to approve the deal, lawmakers and industry representatives say it is hard to imagine any of the other four biggest U.S. tech companies—Apple Inc., Amazon.com Inc., Google parent Alphabet Inc., or Facebook owner Meta Platforms Inc. —being in a position to even attempt to win approval for an acquisition of that size in the current environment.

"If this was any of the other four regular suspects, the blowback would be much greater," said Sen. Mark Warner (D., Va.).

Seniority and experience​

Few other tech executives have Mr. Smith's combination of seniority within their companies and experience grappling with political and regulatory power centers. One of the longest-serving leaders inside Microsoft, he joined in 1993 and served as a legal adviser through its bitter antitrust disputes with regulators around the world in the 1990s.

Microsoft's general counsel in the '90s had a more confrontational approach with regulators, said former Microsoft employees. In 2001, Mr. Smith made a pitch to Microsoft's board of directors to become the next general counsel with a single PowerPoint slide that said: "It's time to make peace." He started the job the next year.

Mr. Smith's role changed again after 2014, when Satya Nadella, a soft-spoken engineer, became CEO and quickly moved to shift Microsoft's culture from combative corporate politics to more collaboration within and outside the company. One of his first public actions was to make Microsoft's Office productivity software available on Apple's iPad—a move away from tying its applications closely to its Windows operating system.

Clash with rivals​

Since taking the president's job, Mr. Smith has become a more prominent public face of Microsoft. He relished the role—members of his team sometimes referred to him as "Governor Smith"—and often talked about having cell numbers of important members of Congress, said people who worked with him.

"We've tried to identify the concerns that people might have and then go address them proactively," Mr. Smith said. "I think that's going to serve us better in getting [the Activision] acquisition approved."

After the company announced the Activision bid early this year, Mr. Smith's team reached out to aides of Rep. Ken Buck, the top Republican on the House Antitrust Subcommittee, whom the tech executive has known for years.

Mr. Smith wanted to assuage any concerns the Colorado congressman might have about the impact of the deal on industry competition, an issue Mr. Buck has championed.

Mr. Buck, one of the most vocal critics of big technology companies in a Congress full of them, seemed persuaded. Within hours of the deal's announcement, he posted about it on his Twitter account, which he routinely uses to assail Amazon, Apple, Facebook and Google. "The assurances I've received from Microsoft are encouraging," he tweeted, adding that Microsoft said it would emphasize access to gaming titles and competition in the marketplace.

Focus on market power​

In mid-2020, Mr. Buck and other members of the House antitrust panel were preparing for a contentious hearing with the CEOs of Amazon, Facebook, Apple and Google on the companies' market power. Subcommittee staff organized a virtual meeting with lawmakers of both parties, envisioned as a sort of pep talk before they faced the tech titans.

Mr. Smith was the guest speaker. Over an hour, he delved into Microsoft's history under Washington scrutiny. One takeaway for lawmakers, two attendees recalled, was that asking CEOs tough questions is a good thing.

Mr. Shaw, the Microsoft spokesman, said Mr. Smith's message was that the experience had taught the company it needed to address "heightened expectations" and "to get out and listen to what other people had to say and do more to help solve technology problems."

Executives at other companies privately fumed that Microsoft was a collaborator on the committee's investigation, rather than a target, according to people familiar with their thinking.

Microsoft annoyed Apple last year when Microsoft was an important witness for "Fortnite" maker Epic Games Inc.'s case against Apple, which claimed anticompetitive practices in the App Store. The case mostly swung in Apple's favor and is now under appeal. Apple accused Microsoft of being the puppet master behind the claims. "A reasonable observer might wonder whether Epic is serving as a stalking horse for Microsoft," Apple said in a court filing.

Activision in spotlight​

The Activision deal puts Microsoft in the spotlight with regulators. Microsoft doesn't expect to close the deal until June 2023. It is being reviewed by the Federal Trade Commission, led by Chairwoman Lina Khan, who has broadcast her plans to increase scrutiny of mergers.

On Thursday, four U.S. senators sent a letter to the FTC citing concerns about the deal, saying it could undermine employees' calls for accountability over alleged misconduct at Activision.

Around the time the deal was announced in January, Mr. Smith said he woke up at 4 a.m. with his mind full of ideas. Unable to fall back asleep, he began sketching out a plan to blunt criticism by addressing competition concerns head-on.

He called Microsoft's gaming chief, Phil Spencer, at 8 a.m. to hammer out plans to contact Sony Group Corp. , Microsoft's main competitor in gaming, to let it know Microsoft would continue to make Activision games for Sony's PlayStation consoles.

Mr. Smith decided with Mr. Nadella, the CEO, to announce that Microsoft planned to pre-emptively make its app store more open than Apple's without government pressure, such as by not requiring developers to use a proprietary payment system.

The company saw this as part of a pitch to regulators around the world that it would be a good steward of a huge addition to its already big gaming business. The next month, it unveiled the new app store principles in Washington to lawmakers and the press.

"We're more focused on adapting to regulation than fighting against it," Mr. Smith told reporters. "We want to be clear with regulators and with the public that if this acquisition is approved, they can count on Microsoft to adapt to the rules that are emerging, and run our business in a responsible way."

 

[Dabaus]

What if this pisses Japan off and they block the activsion merger now? Is Microsoft seriously suggesting they’re going to strong arm themselves into japan by essentially threatening the Japanese government with bad trade deals? What company is even going to want to sell to them if that’s the case? Does Microsoft get to pick who they want “or else?” This seems like just a high risk move on their party as it does Sony being so stubborn blocking the deal.

We don’t even know what China is going to do in regards to the deal and if they block, then you have japan block it out of spite they’d risk being locked out of the East. Not saying any of that will happen but all of this has unintended consequences.

 

[Yobo]

They should probably speak to Peter Moore about why Xbox doesn't sell in Japan. He is alot more honest in his appraisal

Sony does seem to be doing better than you in Japan...-
One would hope so. Although they're getting beat; what, better in relation to us, but getting outsold six to one last month by Nintendo?

The Xbox original didn't do very well in Japan. You went into this generation being bold about saying this time we're going to get it right, and yet you're still shifting 3000 a week...
Yeah, we move three, depending... We had Trusty Bell [Eternal Sonata in the West] ship a couple of weeks ago. Yeah, the numbers are the numbers. We shipped 7000 that week, and we trickle on.

Simply measuring hardware sales in Japan people only see a very small part of the very complicated relationship I deal with... And that is being part of the global publishing infrastructure with the Japanese publishers.

When you go over there it is about face, honour and respect. They respect the fact we compete in the Japanese market. They also respect that their own market is flat-to-declining and they've taken a more global view.companiesompanies, they don't like foreign games.' Whatever excuse I could make, but that would be disingenuous to what we need to give to Japan.

Japan is far deeper than simply looking at Famitsu numbers and saying we're only selling 3000 units. It's still the cradle of our industry. It's still where some of the greatest games are made.

We're going to be representing a lot of the Japanese publishers in Europe... You're going to see more of that from us.I've the greatest respect for all of those people, and I like to think they have the greatest respect for us. They like the fact that we go in and we compete and we try.

But they're not buying Xbox 360s.
The Japanese underground consumer is probably not buying it as much as I would like; that's a fair comment. But again if that's your only measurement...

I'm trying to make the point that it's more complicated. There are greater benefits that you don't see simply by Japanese Famitsu sales every week.

I just won't take no for an answer. We're just going to continue to develop games over there - Lost Odyssey's going to be fabulous - and we're going to keep hammering away.

Do you think you have the right strategy? Because it doesn't appear to be working.
Well, it depends what working means. That one measurement...

It's quite an important measurement.
Hardware and what we do with our domestic subsidiary in Japan is not turning out the way I would have hoped. Fair comment. The overall uber-strategy of ingratiating ourselves with some of the most powerful publishers in the world so we can deliver millions of units of games around the world - that is working.

So you'd rather have the relationships...
I'd rather have both, but right now I'm happy... You're probably right - we've done it either wrong, or haven't executed well, or somehow Sakaguchi was the wrong guy, or marketing has been flawed. But we're just going to keep going at it.

So what has been going wrong?
It's tough to say you've done something wrong... We flew out and met Sakaguchi-san three years ago in Hawaii where he lives, and we sat down and we figured this whole thing out.

If the complaint last time was you don't have Japanese RPGs, well, we went and got Japanese RPGs - and Blue Dragon's sold well. It hasn't blown the doors down by any means, but we believe in him.

Also enjoyed this part from the same interview

Going back to what you were saying about how games are more expensive these days and costs are rising, you recently spent USD 50 million on Grand Theft Auto 4 content...
No we didn't. Take-Two I think reported something - I can't speak for companies that are publicly traded that are not Microsoft - but they reported, and didn't attribute it to us but reported getting revenues for, I can't remember the phrasing in their accounts, but recognising revenue for content in the future... We didn't make a statement.

The official line was "no comment on rumour and speculation". Presumably you would have given them a lot of money to secure that exclusive...
We have a business arrangement, because there's a cost involved for Take-Two and Rockstar to go and do things. Clearly business arrangements are always private... It's no different from business arrangements that Sony has, no different than business arrangements Nintendo has.

Yes, we're delighted to be able to have that episodic content, and that stuff doesn't come for free. But we're not going to comment on somebody else's financials; that would be rude of us.

So it's not bribery, to use Jack Tretton's phrase.
That was a strange comment. I'm not going to get involved in that, but saying they've never had a business relationship with a publisher to make content for the PlayStation platform...

We do it all the time. We're not shy about saying we'll sit down with publishers and ask how can we invest in making their game better on our platform. We did it with Guitar Hero, and it worked out very well.

Jack made a statement and I'm not going to get lured into a battle... He knows how to run his business.

E3: Peter Moore Talks Xbox 360

Plus the next-gen battle and billion dollar costs.

www.gamesindustry.biz

 

[Yobo]

What if this pisses Japan off and they block the activsion merger now? Is Microsoft seriously suggesting they’re going to strong arm themselves into japan by essentially threatening the Japanese government with bad trade deals? What company is even going to want to sell to them if that’s the case? Does Microsoft get to pick who they want “or else?” This seems like just a high risk move on their party as it does Sony being so stubborn blocking the deal.

We don’t even know what China is going to do in regards to the deal and if they block, then you have japan block it out of spite they’d risk being locked out of the East. Not saying any of that will happen but all of this has unintended consequences.

Antagonizing the Japan Government seems like a sure way to ensure they don't pass any acquisitions MS might want in that market

Also calling attention to Sony's fight with MS if Sony were to acquire someone

 

[MScarpa]

Sony better start buying japan pubs otherwise they might not get the chance

Japan is a dead market. NA is the king.